Arbitration is an alternative way to solve a dispute without going to court. It an alternative used instead of going to court. It is mainly used for business to business and commercial type disputes.
Arbitration – How does it work?
Generally speaking when there is a dispute between two parties they refer the problem to a person known as an ‘Arbitrator’. An arbitrator makes the decision about the dispute. Instead of the decision being called a judgment, it is known as an ‘arbitration award’.
Arbitration is also used by businesses and high net worth individuals in international disputes. This is mainly because details about the dispute are usually kept out of the general news available to the public.
What are The Main Advantages?
Before entering into an agreement to arbitrate, business should consider what the main advantages of arbitration are for them. One of the main advantages is privacy and confidentiality. Another advantage is that often it is faster and cheaper than litigation in court. It can often be flexible too.
Is It Legally Binding?
Often businesses wonder and ask is it binding? The answer is that if there an agreement in place between the parties which requires the parties to arbitrate a dispute, then arbitration is usually legally binding.
The Privacy Factor
Increasingly more and more businesses are turning towards this method of alternative dispute resolution instead of taking a dispute to court. Many businesses like the fact that the arbitration process is usually private and confidential. The very fact that it is private means that details about the dispute are not public. Often, a benefit is that parties or their representatives do not usually talk about the dispute to journalists.
Can I Overturn or Appeal an Arbitration Award?
Once an award is made it can be very difficult to overturn or appeal. There are very few circumstances in which an award can be overturned. Each individual case should inevitably be decided on its facts. Expert advice is almost always needed to try and overturn or appeal an arbitration award. Tahir Ashraf advises on all aspects of arbitration and can assist with pre-contract negotiations as well commercial disputes.